In this paper, an attempt is made to study and improve the transportation facilities of a milk industry using a simulation model developed using Arena. The objective of the proposed simulation model is to demonstrate the optimality of the type of truck that needs to be utilized while transporting the milk keeping into mind the sustainable factors such as environmental and social factors. The case study data have been collected from eight different villages for the quantity of milk supplied and the transportation time from these villages to the respective bulk milk coolers. Based on the data transportation, time histograms are plotted. From these histograms, the goodness of fit line representing the probability distribution curve for all different areas was identified. An Arena-based simulation model was developed for optimization and comparison with the current model. From the findings of the research, it is concluded that the optimized heterogeneous fleet supply chain model is more suitable for the dairy industry, as it is more economically viable and environmentally friendly. The proposed simulation model will aid in the process of decision-making on problems related to logistics and supply chain in similar dairy units. © 2020, The Institution of Engineers (India).